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UKHospitality calls for further support after new Energy Prices Bill announced

Kate Nicholls, chief executive

Trade body UKHospitality has warned that “hospitality businesses will struggle to make it through to next spring” without a reduced VAT rate and further business rates relief, as the government is set to introduce the new Energy Prices Bill to provide energy bills support for businesses and domestic consumers across the country.

The Bill will see businesses and non-domestic properties receive support through the Energy Bill Relief Scheme, which will include a price guarantee and a limit on the revenue low-carbon electricity generators receive.

Businesses with fixed energy contracts agreed from 1 December 2021 will benefit from the relief initiative, with the government extending the period covered by the scheme by four months, after initially announcing it would apply to fixed contracts agreed on or after 1 April 2022.

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The legislation also includes a new temporary cost-plus revenue limit in England and Wales, due to come into effect from the beginning of 2023, which is intended to reduce the impact of rising wholesale energy costs by implementing a revenue limit to restrict the amount made by generators.

Kate Nicholls, chief executive at UKHospitality, said: “The government’s intervention to support hospitality businesses facing soaring energy costs this winter is extremely welcome and it’s fantastic to see this legislation introduced. The measures in this Bill will provide relief to all manner of hospitality businesses, from the smallest companies to the largest.

“The introduction of these measures follows months of campaigning by UKHospitality to ensure the government recognised the huge impact rising energy costs will have on our sector.

“I’m pleased that the government has continued to listen to the sector to ensure its relief package is inclusive for all. Its decision to expand the scheme to include operators on fixed price contracts agreed from 1 December 2021 has avoided unfairly penalising businesses who had acted early to protect themselves from further price hikes. The publication of wholesale energy prices will also provide much-needed clarity for businesses.”

Despite the positive move by the government to extend the eligibility criteria for the support scheme, Ms Nicholls said businesses will still need further support to ensure their survival in the coming months.

She added: “Unfortunately, the reality of this crisis means that, even with this support, energy bills will still be much higher than last year and many hospitality businesses will struggle to make it through to next spring.

“What the sector really needs now is the introduction of longer-term measures that can allow us to boost economic growth, namely a lower rate of VAT and further business rates relief.”

The trade association also unveiled its programme aimed at guiding the sector to net zero by 2040 during a seminar at the London Marriott Hotel Grosvenor Square yesterday, setting out 10 pledges in four key areas – waste, supply chain, skills and biodiversity.

The initiative forms part of a wider drive to help businesses, especially small and medium enterprises (SMEs), make hospitality a leader in sustainability.

An accompanying Environmental Sustainability Guide for the Hospitality Sector SMEs was revealed in a presentation by Burger King UK’s chief financial officer, Tim Doubleday.

The guide includes practical actions for businesses to take, such as making 100% of plastic packaging reusable, recyclable or compostable; ensuring all employees have completed WRAP’s 15-minute course on food waste; reviewing menus to incorporate more locally produced goods and plant dishes; and engaging with suppliers to source low carbon food alternatives for menus.

Delegates at the seminar were also addressed by Liz Harrowell, associate director for climate risk and strategy at KPMG, who discussed how climate change could impact business models and the strategic levers available to drive de-carbonisation of the value chain.

Two discussion sessions at the event– To Net Zero and Working Together for a Sustainable Future – featured panellists from the Zero Carbon Forum, Sky, Britvic, Sodexo, Waste and Resources Action Programme (WRAP), and Biffa.

Ms Nicholls said: “Hospitality has been swift to embrace and accelerate sustainable practices in recent years but we’re entering a crucial phase in dealing with climate change, which makes our new Sustainability Commitment vitally important if we’re to deliver on 2040 net zero aims for the sector.

“Ours is an overwhelmingly SME-led industry, so it’s crucial that SMEs are equipped with specialised tools to deliver the environmental targets set out by government, and to build businesses whose everyday operations are environmentally friendly.”

The 10 pledges outlined in UKHospitality’s Sustainability Programme are:

1. To deliver on 2040 net-zero aims for the sector
2. Roll out the UKH sustainability guide to members focusing on providing SMEs with tips, templates and best practice resources
3. Eliminate unnecessary single-use packaging by 2025
4. Reduce food waste by 50% by 2030
5. Incorporate sustainability skills in relevant training courses and promote the appointment of site-based sustainability champions
6. Support the Hospitality Sector Council’s Sustainability Committee on the delivery of the Hospitality Strategy’s environmental targets
7. Promote sign-up to external pledges, such as the Courtauld Commitment and Plastics Pact
8. Facilitate engagement across supply chains to reduce environmental impacts
9. Promote the roll out of EV charging points across the sector
10. Work with the Hospitality Sector Council to align industry objectives and share best practice amongst businesses

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Tags : UKHospitality
Joshua Walton

The author Joshua Walton

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